Weekly Mortgage Watch – September 3, 2018

First Team’s Weekly Mortgage Watch (September 3rd, 2018) This Week Highlights The Following Updates:

• Even with the GDP estimate being adjusted upward and a spike in Consumer Confidence, mortgage rates remained very near the previous week’s levels.
• While second quarter’s GDP will be very strong, coming in over 4.0%, current data points to some slowing to around 3.0% for the third quarter.
• The strong Confidence reading was balanced against a decline in Consumer Sentiment.
• While we are very likely to set a record for the longest economic recovery, the pace of economic growth has been relatively steady, only spiking occasionally.
• Inflationary pressures have remained below levels that would concern the Fed, enabling the Fed to maintain an accommodative posture for an extended period of time. While we are moving toward “normal,” we appear to remain on a very gentle path.
• This week will be bookended by the ISM Manufacturing Index and the monthly employment data. If both the readings come in under expectations, rates are likely to remain flat.
• They simply don’t have much room to fall, especially given that the Fed’s next rate hike is expected in a few weeks.

Wildfires Don’t Stop Home Development

According to a study from UNLV, the risk of wildfires does not create a long-term risk for home sales. In 1990, an estimated 30.8 million housing units had been built in forested land, which is more prone to wildfires. By 2010 that number had grown to 43.4 million. The study’s authors used modeling techniques to compare high-risk vs. low-risk home development. Within two years following a fire event, homes home sales had completely rebounded in high-risk areas.

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